Technical outlook and chart setups:
Gold has remained sub-dued to bearish pressure yesterday, producing an engulfing bearish candlestick pattern on the daily chart view as seen here. The metal has tested lows at $1,251.00/52.00 yesterday before pulling back up to $1,256.00 at close. Please note that Gold still remains around the fibonacci 0.786 support region of the entire rally from $1,240.00 to $1,340.00 levels during the last 3 months' rally. Furthermore, the structure of a potential inverted head and shoulder still remains intact with the right shoulder still being carved out a bit lower than expected ($1,250.00 levels now). The metal should remain supported ahead of $1,240.00 levels for now. Resistance is seen at $1,296.00, $1,325.00 and above. A bullish reversal signal here would bring back bulls strong enough to remain in control.
Trading recommendations:
Remain long/initiate fresh long positions, stop $1,240.00, target is open.
Good luck!
